This week, Defense Secretary Leon Panetta held a news conference on defense budget cuts at the Pentagon. “The military will be smaller and leaner, but it will be agile, flexible, ready and technologically advanced; it will be cutting edge,” he told reporters. The U.S. Army will be reduced from 547,000 active-duty soldiers to 490,000, while the U.S. Marine Corps will be cut to 182,000. The Army also plans to remove at least eight brigade combat teams from its existing force structure. To reduce projected spending by $487 billion over the next 10 years, the Pentagon is eliminating what it describes as “poorly performing programs” and has identified an additional $60 billion in efficiencies. The first tranche of those spending cuts — $259 billion — will come over the next five years. These cuts do not take into consideration the possibility of sequestration which could initiate an additional $500 billion cut in January 2013 if Congress does not find an alternative way to reduce the country’s deficit. In 2013, the Pentagon is requesting $525 billion for its base budget, with an additional $88.4 billion for overseas contingency operations. Today’s five-year spending plan projects the Defense Department will need $567 billion for its base budget in 2017.
Textron Inc. (Up 17.3%) – Shares are up this week after the Company announced that it expects revenues of approximately $12.5 billion and earnings per share (“EPS”) from continuing operations to be in the range of $1.80 to $2.00. According to estimates, analysts were expecting the Company to report revenues of $11.9 million and EPS of $1.66 for fiscal 2012.
CIBER, Inc. (Up 13.6%) – Shares are up this week after the Company announced that it entered into a purchase agreement to sell its Federal Division and related assets to CRGT Inc.
Wesco Aircraft Holdings, Inc. (Up 9.3%) – Shares are up this week after the company announced results for its fiscal first quarter ended December 31, 2011. Revenue for the first fiscal quarter was $192.6 million, another quarterly record and an increase of 11.0% compared to $173.5 million in the prior year period. Wesco demonstrated strong international growth during the quarter with revenues in the Rest of World segment increasing by 29.7% compared to the prior year.
CRGT, Inc. acquires Federal Division of CIBER, a provider of emerging technology solutions for the U.S. federal government for $40 million. CRGT is a portfolio company of Veritas Capital. The acquisition furthers CRTG’s strategic growth plan, positions the Company to better serve a broader spectrum of the Federal marketplace, and adds unique capabilities that are provided to a diverse customer base.
Sun Capital Partners to acquire Pacific Safety Products, Inc., a manufacturer of advanced armor and personal protection solutions. The acquisition allows Sun Capital Partners to enter into the person protection equipment market. Terms of the deal were not disclosed.